Apollo Seeks Appeals Court Reversal in Bankrupt Oil Driller Row

Apollo Global Management and Fidelity Management & Research Co. pushed an appeals court Tuesday to unwind a bankruptcy court ruling that awarded them an only 30% stake of oil driller Mesquite Energy Inc. and 70% to its unsecured creditors.

A Houston bankruptcy court was wrong to decide that unsecured creditors could have pursued a lawsuit and recovered $200 million for “worthless” liens the estate had already recovered, Jones Day partner and former US solicitor general Noel Francisco told a panel of the US Court of Appeals for the Fifth Circuit on Tuesday.

Francisco represented secured noteholders and bankruptcy lenders, including ...